Real Media Riffs - Monday, Dec 18, 2006

IF THE MEDIUM IS THE MESSAGE, VNU WANTS TO BE ITS MESSENGER -- The restructuring of VNU signals two important trends that readers of this column might want to take heed of: 1) The increasing influence of private equity firms in the transformation of the media industry; 2) The growing importance of media vs. marketing knowledge.

We'll save an exploration of the first trend for another day. Safe to say it's real, it's fundamental, and it's not going to stop anytime soon. So get used to it.

As for the second trend, we're not saying it's right or wrong, but we're definitely seeing it happen, and we're not so sure it's a bad thing. Of course, we here at the Riff tend to be a little media-centric to begin with. And from how we see it, the role of media insights is growing, and the ascendance of Nielsen Media Research within VNU is merely the latest testament to that.

Don't get us wrong. We're not saying that marketing insights aren't important. It's just that there's suddenly a more pressing need for a better understanding of the places that marketers actually connect with their consumers. And it's being driven by several phenomena. Let's tick them off.



First, and fairly importantly, marketers have made tremendous inroads in their marketing knowledge. Ever since the emergence of database marketing, and especially the development of advanced regression modeling techniques, big marketers have gained a pretty good understanding of how various marketing efforts generate results--most often measured in the form of sales. They know what works and what doesn't work, even if they don't always understand how and why it works. Two of the big independent variables, of course, are advertising and media. So on a relative basis, marketers simply now need to understand more about the role of media in their mix.

A big reason for that is the growing complexity of media, and the increasing consumer control over it. Media has been steadily growing more complex as the number of media options expanded over the past century, but the advent of digital media, especially the Internet, has fragmented it exponentially. Consumers simply have more choices than ever before--and with greater choice comes greater control.

Meanwhile, media technologies are giving consumers greater physical control over how, when and where they want to manipulate their media. The Web--both versions--TiVo, iPod, Slingbox, the Venice Project, and whatever comes next are just part of a progression of seamless, malleable, fungible media manipulation. It's going to continue. So get used to it. Research it. Adapt to it. That's life-- even if it's a second one.

The private equity guys who took over VNU seem to understand that. David Calhoun, the GE-bred guy they brought in to run it, does too. So they're concentrating their eggs in the media basket. They're doing it for the obvious reasons: because media research is growing at a much faster rate than marketing research; and because VNU (i.e., Nielsen) dominates media research more than it does marketing research.

The truth is that neither is more important than the other, and ultimately great marketers, advertisers, agencies and media should understand the ebb and flow of the marketplace in a broader, more holistic sense. That means understanding how products and their attributes resonate with prospective consumers, as much as it does how, where, when and why they should deliver messages about those attributes. Media is the yang to marketing's yin. And if that highly stretched metaphor is even remotely accurate, then Jon Mandel is VNU's new Taoist kung fu master who's going to make them connect.

Mandel is the former Madison Avenue media maven who VNU tapped to activate its "follow the consumer" strategy, and to integrate disparate marketing and media research services into something truly actionable. It's a challenge for sure. It's been tried many times before. But this time, VNU has some new powerful assets: the dominant supplier of marketing research (ACNielsen), including its host of products and services; a burgeoning Nielsen Media Research, which is also moving more into marketing research with things like Project Apollo and Nielsen In-Store, blurring the lines of marketing and media research; and, of course, Mandel.

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